The Income Tax division Saturday issued an advisory that the ones everlasting account numbers (PAN) which don’t seem to be connected with Aadhaar via the tip of March subsequent 12 months shall be rendered “inoperative”.
“What is mandatory, is necessary. Don’t delay, link it today!” the dept stated in a public advisory.
“As per Income-tax Act, 1961, it is mandatory for all PAN holders, who do not fall under the exempt category, to link their PAN with Aadhaar before 31.3.2023. From 1.04.2023, the unlinked PAN shall become inoperative, it said.
The ‘exempt category’, according to a notification issued by the Union Finance Ministry in May 2017, are those individuals residing in the states of Assam, Jammu and Kashmir and Meghalaya; a non-resident as per the Income-tax Act, 1961; of the age of 80 years or more at any time during the previous year and a person not a citizen of India.
A circular issued by the Central Board of Direct Taxes (CBDT) on March 30 said once a PAN becomes inoperative, an individual shall be liable to all the consequences under the IT Act and will have to suffer a number of implications.
The person shall not be able to file IT return using the inoperative PAN; pending returns will not be processed; pending refunds cannot be issued to inoperative PANs; pending proceedings as in the case of defective returns cannot be completed once the PAN is inoperative and tax will be required to be deducted at a higher rate.
“In addition to the above, the taxpayer may face issue at more than a few different fora like banks and different monetary portals as PAN is among the necessary KYC (know your buyer) criterion for a wide variety of economic transaction,” the round stated.
The CBDT frames coverage for the Income Tax division.
While Aadhaar is issued via the Unique Identification Authority of India to a resident of India, PAN is a 10-digit alphanumeric quantity allocated via the IT Department to an individual, company or entity.